Oral Answers to Questions

Natascha Engel Excerpts

Thursday 31st January 2013 Commons Chamber

[Natascha Engel (North East Derbyshire) (Lab)]

13. What recent assessment he has made of the financial return of the subsidy for onshore wind farm providers.

[The Secretary of State for Energy and Climate Change (Mr Edward Davey)]

Following a comprehensive review of renewable obligation subsidies, the Government announced on 25 July last year that the level of support for onshore wind developments would be reduced by 10% to 0.9 renewable obligation certificates per megawatt hour with effect from 1 April 2013. This represents a 9.6% rate of return on investment.

[Natascha Engel]

My constituents in Uppertown feel that, without their taxpayer subsidy to the onshore wind farms that they do not want, these wind farms would not be blighting their landscape. What steps is the Secretary of State taking to review the taxpayer subsidy and the value for money that the taxpayer is getting for onshore wind farms?

[Mr Davey]

First, let us be clear. Although, as the Minister of State, Department of Energy and Climate Change, my right hon. Friend the Member for Bexhill and Battle (Gregory Barker) said earlier, taxpayers are often consumers, the subsidies are paid for by consumers when and only when a wind farm produces electricity. There is good value for money for consumers, so I think onshore wind and offshore wind play a really important part in our energy mix. As the hon. Lady knows and as I said in my initial answer, we have reviewed the subsidies going to onshore wind and to all other renewables. In addition, because concerns were expressed around the House, we issued a call for evidence to check that the figures we used in our most recent analysis are up to date, particularly with respect to onshore wind. We will report back to the House on that call for evidence to see whether there have been changes to the cost structure that we did not find in our previous analysis.